A GIC remission request requires the correct ATO remission application form, evidence of the circumstances behind the late payment, and lodgement through ATO online services, a registered tax agent, phone, or mail.
GIC incurred on or after 1 July 2025 is non-deductible, which makes remission the only mechanism that cancels interest already charged on an ATO debt. The Commissioner of Taxation decides each request under PS LA 2011/12 against three factors: the cause of the delay, fairness and reasonableness, and your compliance history.
The ATO introduced dedicated remission forms and a dedicated review team in January 2026. A refused GIC remission decision carries no objection right; the pathways are a new request, an IGTO complaint, or Federal Court judicial review.
The ATO describes its remission process pages as interim guidance pending a broader review of taxpayer relief provisions. Details current as at 4 August 2026; on our quarterly review schedule.
What Is GIC Remission and Who Decides It?
GIC remission is the Commissioner of Taxation’s discretionary power under section 8AAG of the Taxation Administration Act 1953 to cancel all or part of the general interest charge on a tax debt.
Remission is a discretion, not an entitlement. A delegate of the Commissioner reviews each request against PS LA 2011/12 and can remit in full, remit a portion, or refuse.
The stakes compound daily: GIC accrues at 11.43% per annum for the July to September 2026 quarter, at a daily rate of 0.03131507% on the balance including prior interest. A $100,000 debt accrues $944 of interest in 30 days.
Why Remission Matters More After 1 July 2025
GIC incurred on or after 1 July 2025 is non-deductible under section 26-5(1A) of the Income Tax Assessment Act 1997, which converts every dollar of unremitted interest into a pure after-tax cost.
The Treasury Laws Amendment (Tax Incentives and Integrity) Act 2025 repealed the specific deduction in section 25-5(1)(c); the table shows what that shield was worth.
Structure | Effective GIC cost when deductible | Effective GIC cost from 1 July 2025 |
Base rate entity company (25%) | 8.57% | 11.43% |
30% tax rate company | 8.00% | 11.43% |
Individual or trust beneficiary at 47% (top marginal rate plus Medicare levy) | 6.06% | 11.43% |
One offsetting rule applies. Remitted GIC that was never deductible does not count as assessable income; remitted GIC from the deductible period is an assessable recoupment in the remission year, and a remission straddling 1 July 2025 requires an allocation between the two, decided by the incurral timing rules.
What Grounds Does the ATO Accept for GIC Remission?
The ATO remits GIC where the delay was caused by circumstances beyond your control, by ATO error or delay, or where charging the full amount would not be fair and reasonable.
These limbs come from PS LA 2011/12, not from the “reasonable cause” language that governs penalty decisions; framing a request against the wrong framework weakens it from the first line.
Circumstances Beyond Your Control
Circumstances beyond your control are events that stopped payment despite reasonable steps on your part to meet the obligation.
The ATO’s published list: natural disaster affecting you or your agent, sudden ill health of a sole trader, key personnel, or your tax agent, theft of or damage to critical property, unforeseen collapse of a major debtor, bereavement, and family and domestic violence or financial abuse.
Each ground carries an evidence class: medical certificates, police reports, insurance claims, receivership notices, disaster declarations. The event alone does not carry the request; the delegate also weighs the steps you took once it passed.
ATO Delay or Error
ATO delay or error covers periods where the ATO’s own administration extended the time over which GIC accrued.
You object, the ATO takes 18 months to decide it, and GIC compounds for the entire period. The delegate will generally remit the interest for the delay period, not the whole balance. Your evidence is a dated timeline: lodgement, acknowledgment, follow-ups, decision date, and the GIC calculated between them.
Serious Financial Hardship
Serious financial hardship supports remission under the fair and reasonable limb where paying the GIC would threaten the viability of the business or household.
The threshold is high. The delegate expects full financial statements, cash flow projections, and evidence that other options are exhausted; a large bill you would prefer not to pay does not qualify. Hardship requests usually produce partial remission rather than full.
The Three-Factor Test the Delegate Applies
The delegate tests every GIC remission request against control, fairness, and compliance history.
A late payment that is out of pattern with an otherwise clean record strengthens the request substantially. Where the GIC at stake is $2,500 or less, the ATO states that a positive compliance history strongly influences the decision on its own. The ATO’s published examples reveal the pattern:
The ATO would likely remit | The ATO would likely decline |
Flood, fire, or drought affecting you or your agent | General economic downturn or rising supply costs |
Hospitalisation of a sole trader or key person | Illness of a director while the company traded normally |
Collapse of a major debtor, with early ATO contact | Routine late payment of invoices by a customer |
Theft of or damage to critical business property | Spending available funds on expansion, not the debt |
Family and domestic violence or financial abuse | Being on holiday when payment fell due |
Delay caused by the ATO’s own processing | Giving your agent insufficient time before the deadline |
How to Lodge a GIC Remission Request
A GIC remission request is lodged by completing the ATO GIC remission application form and attaching it to a secure mail message in ATO online services, by phone for smaller amounts, or by mail.
The ATO rebuilt this process in January 2026 around standardised forms and a dedicated review team.
The Remission Application Forms
The ATO publishes separate remission application forms for GIC, SIC, and FTL penalties, and each form must be lodged in its own secure mail message.
Three mechanics catch first-time applicants. One form covers one taxpayer and one charge type, so GIC plus SIC means two forms. One GIC form covers every account, so income tax and activity statement interest belong on a single form. The GIC form must be submitted in Excel format only; the ATO’s instructions exclude PDF copies. Download the current version from the ATO’s remission request page each time, because the ATO revises the forms without notice.
Lodgement Channels by Taxpayer Type
Each taxpayer class lodges GIC remission requests through a defined set of channels.
Registered tax and BAS agents lodge through practice mail in Online services for agents, or by the agent phone line. Businesses and sole traders with an ABN lodge through secure mail, phone, or mail; individuals by phone or mail; legal practitioners by mail or phone. Phone carries a threshold: requests over $2,500 escalate to the dedicated team with no decision on the call.
What the Request Must Contain
A GIC remission request must state the specific event, exact dates, the causal link to the late payment, the steps taken to reduce the delay, and the amount of remission sought.
Structure it as a chronology with evidence attached to each date, and state the remission sought in figures: full, or partial for a defined delay period with the GIC calculated. Requests built on the rate being high, a good-faith dispute alone, or unparticularised hardship fail. The ATO cross-checks lodgement history, payment history, and asset holdings, so the form must reconcile with the file.
How Does the ATO Decide, and How Long Does It Take?
The ATO assesses each request against PS LA 2011/12 using your evidence and its own account data, and issues a written decision with reasons where it declines.
No service standard exists for the new forms. Phone requests under $2,500 can resolve on the call; form-based requests run from weeks to months, so follow up in writing after 30 days. Timing depends on context: in a dispute, lodge after the objection resolves the liability and before you pay, since in practice the ATO declines to assess remission while the liability is contested.
In a cash-flow debt, the sequence reverses: contact the ATO before the due date, enter a payment plan, and request remission once it completes. The ATO’s examples grant that sequence where a major debtor collapsed and decline it where the taxpayer held the funds and reinvested them. The grounds decide the outcome; the sequence frames them.
What Are Your Options if the ATO Refuses GIC Remission?
A refused GIC remission decision carries no objection right under Part IVC and no review right at the Administrative Review Tribunal; the pathways are a new request, an IGTO complaint, or Federal Court judicial review.
Some published advice wrongly points refused applicants toward tribunal review. The correct sequence: first, request the reasons and lodge a new application where you left out key information or can identify an error, asking for senior officer review at the same time.
Second, complain to the Inspector-General of Taxation and Taxation Ombudsman, which can recommend reconsideration. Third, for large amounts with a legal defect in the decision, seek Federal Court judicial review under the ADJR Act 1977. Objection rights attach to assessments, not GIC remission; the framework for objecting to ATO decisions runs on a different statutory footing.
GIC Remission vs a Payment Plan
A payment plan defers payment of the debt while GIC continues to accrue daily on the outstanding balance; remission cancels the interest itself.
The interest does not freeze under a plan; it compounds at the full 11.43% rate for the plan’s life. Where grounds exist, raise remission before finalising the plan so instalments are set against the reduced balance. Where grounds are weaker, an early plan still evidences reasonable steps. The ATO payment plan conditions govern eligibility and instalments.
How SIC Remission Differs From GIC Remission
SIC remission follows PS LA 2006/8, uses its own application form, and carries objection rights that GIC remission does not.
Where the SIC remaining after a decision exceeds 20% of the tax shortfall, you can object under Part IVC and take the matter to the Administrative Review Tribunal. SIC also qualifies for phone lodgement where it was calculated on an inflated amount, accrued after payment, or followed an ATO service-standard delay.
The SIC rate is 7.43% per annum for the July to September 2026 quarter, and GIC replaces it on any amount unpaid 21 days after the amended assessment issues.
Mistakes That Sink Remission Requests
Most refused remission requests fail on evidence, timing, or scope rather than on the underlying circumstances.
The recurring failures: applying while the primary tax dispute is still open, a chronology with no documents behind it, framing built on stress or the size of the rate, demanding 100% remission where the ATO caused only part of the delay, lodging the GIC form as a PDF, and paying the full balance before asking. Each one hands the delegate a procedural reason to decline before the merits are weighed.
FTL Penalty Remission Uses the Same Request Process
Failure to lodge penalty remission runs through the same form-and-secure-mail process as GIC remission, but the decision concerns a penalty rather than interest.
A late lodgement usually produces both charges at once: the FTL penalty on the lodgement and GIC on the unpaid liability. Lodge the two forms in separate secure mail messages. The late lodgement penalties framework sets out the per-28-day calculation.
Frequently Asked Questions
Is remitted GIC taxable income?
Not for interest incurred on or after 1 July 2025. Remitted GIC from the deductible period is assessable in the remission year where the deduction was claimed; the GIC deductibility rules set out the incurral timing.
How long does a GIC remission request take?
No service standard exists. Phone requests under $2,500 can resolve immediately; form-based requests run from weeks to months.
Can my tax agent request GIC remission for me?
Yes. Agents lodge the form through practice mail, and an agent-drafted request aligned to PS LA 2011/12 is the strongest format the process accepts.
Can GIC remission be backdated?
Every remission is backdated by nature, because it applies to GIC already accrued. Quantify the period sought and calculate its interest.
Can I apply again after a refusal?
Yes, where you left out key information or can identify an error in the decision. Address the stated refusal reasons directly.
Does a payment plan stop GIC from accruing?
No. GIC compounds daily at the full quarterly rate until the debt is paid or remitted.
Key Takeaways: GIC Remission for Australian Businesses
GIC remission is now the only mechanism that cancels interest already charged on an ATO debt, and a request succeeds on grounds, evidence, and process rather than on the size of the bill.
- GIC incurred on or after 1 July 2025 is non-deductible, so every dollar of the 11.43% charge is paid from after-tax profit, a pre-tax cost above 15.2% for a 25% company.
- The ATO decides each request under PS LA 2011/12 against control, fairness, and compliance history, and its January 2026 forms regime rewards requests that are structured, evidenced, and quantified.
- The GIC application form must be lodged in Excel format through secure mail, with one form per taxpayer and charge type covering all accounts.
- A refusal carries no objection right; the pathways are a new evidenced request, an IGTO complaint, or Federal Court judicial review.
Blackwattle Tax prepares and lodges GIC and SIC remission requests for companies, trusts, and their owners across Australian business tax. Book a free 30-minute director strategy session and we will review the interest on your account, test your grounds, and draft the request on the correct form.
Schedule a FREE 30-minute consultation today to discover how we can help you make strategic decisions and streamline your business operations.
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Disclaimer: We endeavour to make sure the information provided in this guidance is up to date and accurate. Please note, that the information is only intended to be a guide, with a general overview of information. This guidance is not a comprehensive document and should not be interpreted as legal advice or tax advice. The information is general in nature. You should seek the assistance of a professional opinion for any legal and tax issues related to your personal circumstances.